Investment Banking interview preparation
Every question below is either traced to a named firm from a public candidate report, or tagged at desk level when we could not trace it. Answers are written the way you would actually say them out loud — answer first, then the mechanism, then the limitation.
100 questions, mapped to the firms that asked them
- Questions
- 100
- Traced to a firm
- 100
- Firms
- 46
- Updated
- September 2026
019Why do you unlever and relever beta, and why does it matter?Harris WilliamsInvestment Banking · Los Angeles · 2025
Say this
Observed beta reflects both the business risk and the leverage of each peer. You unlever to strip out their capital structures so you are comparing pure business risk, then relever at your target's structure.
Then walk it
- Pull raw betas for the peer set. Each one is contaminated by that company's own debt load.
- Unlever each: asset beta equals equity beta divided by one plus one minus tax times debt over equity. Now you have pure business risk.
- Take the median or mean of the unlevered betas. Median is safer because one over-levered peer can drag a mean badly.
- Relever at your target's capital structure, or its target structure if you expect it to change.
- It matters because skipping it means you have imported someone else's leverage into your cost of equity. In an LBO, where structure changes by design, getting this wrong makes the whole discount rate meaningless.
Where candidates lose it
Knowing the formula but not the purpose. If asked 'why does it matter', the answer is comparability of business risk. Say that first, then the mechanics.
Expect next
- Would you use median or mean of the unlevered betas?
- What is the beta of a slot machine?
- How would you get a beta for a private company?
Reported by candidates at Harris Williams (Investment Banking, Los Angeles, 2025). Source: Wall Street Oasis.
045Based on the financials in front of you, would you advise this company to sell or not?Harris WilliamsInvestment Banking · Richmond · 2024Lincoln InternationalMergers and Acquisitions · New York · 2025
Say this
I would answer the question directly with a recommendation, then defend it on three axes: where the business is in its own trajectory, where the market is in its cycle, and what the owner actually wants.
Then walk it
- Sell into strength. If margins have just peaked, growth is decelerating, and the sector is trading at a cyclical high multiple, that is the moment. Buyers pay for the next three years, not the last three.
- Hold if there is a visible, fundable value-creation step the current owner can capture: a margin programme half done, a new facility about to come online, a contract about to be signed. Let the buyer pay for the result, not the plan.
- Then the owner's own position. A founder with all their net worth in one asset has a diversification reason to sell that has nothing to do with the multiple. A partial sale can solve that.
- Test the buyer universe before recommending a process. A thin buyer list means a weak auction and a weak price, whatever the financials say.
- Then commit. Something like: given decelerating growth, peak margins and a deep strategic buyer list, I would run a process now and target the strategics.
Where candidates lose it
Hedging. Middle-market bankers ask this to see whether you can make a recommendation on incomplete information. Saying 'it depends' and stopping is a fail. Pick a side, then name what would change your mind.
Expect next
- Who would be a dark horse buyer?
- Build me the buyer universe.
- What would change your recommendation?
Reported by candidates at Harris Williams (Investment Banking, Richmond, 2024); Lincoln International (Mergers and Acquisitions, New York, 2025). Source: Wall Street Oasis.
046Who would be a dark horse candidate to buy a pen manufacturer?Harris WilliamsMergers and Acquisitions · Richmond · 2025
Say this
I would look for buyers who want the capability rather than the product. An injection-moulding or precision-plastics group buying for the manufacturing asset, or a promotional-products and corporate-gifting business buying for the channel.
Then walk it
- The obvious buyers are other stationery brands and their sponsors. Those are not dark horses, so I would name them and move past them.
- The manufacturing angle: a pen is a high-volume precision plastics and micro-assembly business. A contract manufacturer in medical devices or cosmetics packaging could want that capacity and tolerance capability.
- The channel angle: whoever owns the shelf. A promotional products distributor, or a corporate gifting platform, buys the brand as a hook for a much larger merchandising catalogue.
- The brand angle: luxury. If the target has any premium line, a luxury goods group could take the brand and abandon the volume business entirely. That is a different valuation basis, brand not EBITDA.
- And the adjacency angle: an office-products distributor integrating backwards, or an Asian manufacturer buying Western distribution and brand. Each of these values a different asset inside the same company, which is the whole point of building a buyer universe properly.
Where candidates lose it
Naming only competitors. The word 'dark horse' means they want to see whether you can decompose the company into its separate assets, manufacturing, brand, channel, and find who values each one most. Structure the answer by asset, not by company.
Expect next
- Which of those pays the most?
- How would you approach them differently in a process?
- How would you value it for a luxury buyer versus a manufacturer?
Reported by candidates at Harris Williams (Mergers and Acquisitions, Richmond, 2025). Source: Wall Street Oasis.
083How would a college increase its revenue?Harris WilliamsInvestment Banking · Richmond · 2018
Say this
Price, volume, mix, and new revenue lines. Raise net tuition by discounting less, grow enrolment, shift mix toward full-fee and postgraduate students, and monetise the assets that sit idle.
Then walk it
- Price: the lever is usually the discount rate, not the headline tuition. Most institutions discount heavily; recovering a few points of net tuition is worth more than a sticker price rise and is less visible.
- Volume: more students, but constrained by capacity and by admissions standards, since taking weaker students damages the brand that supports the price.
- Mix is the highest-return lever. International and out-of-state students pay multiples of the domestic rate. Postgraduate and professional programmes carry better margins. Executive education has almost no marginal cost against existing faculty.
- New lines: online programmes that break the capacity constraint entirely, summer and short courses that use the campus in the off-season, conference and event hire, and licensing the brand.
- And the asset side: parking, retail on campus, research commercialisation and licensing, plus the fundraising engine, since alumni giving is a genuine revenue line that responds to investment.
- The reason mix beats price and volume: operating leverage. Faculty cost is already committed, so an incremental full-fee student in an existing class is almost entirely margin.
Where candidates lose it
Listing ideas without ranking them by margin impact. The interviewer wants commercial prioritisation. Naming operating leverage as the reason mix wins turns a brainstorm into an analysis.
Expect next
- Which would you do first?
- What is the risk of the online strategy?
- How would you value the business after those changes?
Reported by candidates at Harris Williams (Investment Banking, Richmond, 2018). Source: Wall Street Oasis.
087How would you verify the validity of a client's sales pipeline in order to forecast revenue?Harris WilliamsInvestment Banking · Richmond · 2025
Say this
Test it historically before you believe it prospectively. Take last year's pipeline, see what actually converted by stage, and apply those real conversion rates rather than management's assumed ones.
Then walk it
- Back-test first. Pull the pipeline as it stood 12 months ago and compare it to what closed. If management said 60 percent of late-stage would convert and 30 percent did, you now have the real number and the size of their optimism.
- Test the stage definitions. A verbal indication is not a late-stage opportunity. Ask what evidence is required to move a deal between stages, and whether that discipline is enforced in the CRM.
- Check the vintage of each opportunity. Deals sitting in the pipeline for three times the average sales cycle are usually dead and not yet marked dead. They inflate the total.
- Check concentration. If three opportunities are half the pipeline, the forecast is not a probability distribution, it is three binary bets. Diligence those three individually and talk to those customers if the process allows.
- Cross-check against capacity. Does the forecast require more closed deals per salesperson than the team has ever achieved? And check whether headcount to deliver it is actually in the plan.
- Then rebuild the forecast bottom-up with your own conversion rates, and present it as a range against management's case. The gap between the two is one of the most valuable things you can hand a buyer.
Where candidates lose it
Accepting the pipeline and only sanity-checking the arithmetic. The technique is historical back-testing of conversion by stage. If you do not say that, you have not answered it.
Expect next
- What if they have no historical pipeline data?
- How would that change your valuation?
- What would you do if the top three opportunities were all with one customer?
Reported by candidates at Harris Williams (Investment Banking, Richmond, 2025). Source: Wall Street Oasis.
093Lilypads double every day and cover the pond on day 30. On what day was the pond half covered?Harris WilliamsGeneralist · Richmond · 2025
Say this
Day 29. If the area doubles every day, then the day before it was full it must have been exactly half. Work backwards, not forwards.
Then walk it
- Doubling means the step from half to full takes exactly one day.
- Full on day 30 therefore means half on day 29.
- The instinct to halve the number of days and say 15 is the trap. On day 15 the pond is about one thirty-two-thousandth covered, since it doubles fifteen more times.
- The general principle: in exponential growth, almost all of the accumulation happens at the very end. That is why the answer feels wrong.
- It is worth naming the finance version, because that is why the question gets asked: compounding, and the danger of extrapolating an exponential trend from a small base.
Where candidates lose it
Saying day 15. It is the reflex answer and it is wrong by a factor of thirty thousand. Answer in one second, then add the exponential-growth observation so it reads as understanding rather than recall.
Expect next
- What does that tell you about compounding?
- If I make 8 times my money in 6 years, what is my IRR?
- How would you spot a business at the steep part of that curve?
Reported by candidates at Harris Williams (Generalist, Richmond, 2025). Source: Wall Street Oasis.
Firm tags come from public, anonymous candidate reports on Wall Street Oasis: strong signal, not sworn testimony. Firms are named as the places a question was reported, not as partners of Fin Maverick. Answers are written for this page to show how to think out loud; they are not scripts to recite.